Popeyes: Reports Fiscal 2016 Earnings Results

Atlanta / CA. (plk) Popeyes Louisiana Kitchen Inc., the franchisor and operator of Popeyes restaurants, reported results for fiscal 2016 that ended December 25, 2016. PLKI reported net income of 42.8 million USD, or 1.98 USD per diluted share, compared to 44.1 million USD, or 1.91 USD per diluted share in 2015. Adjusted earnings per diluted share(1) were 2.12 USD, compared to 1.91 USD in 2015, representing an increase of 11 percent, consistent with previous guidance.

«We are pleased to report another year of strong performance at Popeyes», said Cheryl Bachelder, Popeyes Chief Executive Officer. «Driving the top line through a careful balance of innovative offerings and core menu value has created momentum in the fourth quarter, despite challenging market conditions. In 2016, we delivered global same-store sales growth of 1.7 percent, our 8th consecutive year of positive same-store sales growth, and 216 new restaurant openings around the world».

Fiscal 2016 Highlights

System Sales Performance:

  • Global system-wide sales increased 7.4 percent, for a two-year compounded growth rate of over 20 percent.
  • Global same-store sales increased 1.7 percent in 2016, compared to a 5.9 percent increase last year, for a two-year compounded growth rate of 7.7 percent.
    • Total domestic same-store sales increased 1.4 percent, compared to 5.7 percent last year, the eighth consecutive year of positive same-store sales growth.
    • International same-store sales increased 4.4 percent, compared to 7.0 percent last year, the tenth consecutive year of positive same-store sales growth.
  • Popeyes market share of the domestic Chicken-Quick Service Restaurant segment reached 26.5 percent for 2016, an increase from 25.5 percent in 2015.

Openings:

  • The Popeyes system opened 216 restaurants, which included 118 domestic and 98 international restaurants, compared to 219 total openings in the prior year.
    • Net restaurant openings were 158, compared to 166 net restaurant openings in the prior year.

Key Financial Metrics:

  • Total revenues increased approximately 3.8 percent to 268.9 million USD in 2016, from 259.0 million USD in 2015.
  • Company-operated restaurant operating profit(1) was 20.7 million USD, or 19.1 percent of sales, compared to 21.9 million USD, or 20.0 percent of sales in 2015.
  • Operating Ebitda(1) was 88.7 million USD, or 33.0 percent of total revenues, compared to 84.0 million USD, or 32.4 percent of total revenues in 2015, a 5.6 percent increase.
  • Free cash flow(1) was 56.0 million USD, compared to 49.9 million USD in 2015.
  • The Company repurchased approximately 1.8 million shares of its common stock for approximately 100.0 million USD.

Fourth Quarter 2016 Highlights:

  • Reported net income was 9.2 million USD, or 0.44 USD per diluted share, compared to 9.6 million USD, or 0.42 USD per diluted share in the fourth quarter 2015. Adjusted earnings per diluted share(1) were 0.48 USD, compared to 0.42 USD in 2015, representing an increase of 14.3 percent.
  • Global same-store sales increased 2.8 percent.
    • Total domestic same-store sales increased 3.0 percent, compared to 2.0 percent in the fourth quarter of 2015, for a two-year compounded growth rate of 5.1 percent.
    • International same-store sales increased 1.6 percent, compared to 8.5 percent in the fourth quarter of 2015, for a two-year compounded growth rate of 10.2 percent.
  • The Popeyes system opened 89 new restaurants compared to 82 new restaurants in the fourth quarter of 2015.

(1) Adjusted earnings per diluted share, operating Ebitda, operating Ebitda margin, Company-operated restaurant operating profit, Company-operated restaurant operating profit margin and free cash flow are supplemental non-GAAP measures of performance.

Capital Structure Update

On February 15, 2017, the Company increased the aggregate revolving loan commitments under its 2016 revolving credit facility to 400 million USD. With the 150 million USD expansion, availability for short-term borrowings and letters of credit under the amended and restated credit facility is 244.4 million USD. There were no changes to any other key terms of the credit facility.

Corporate Profile

Popeyes Louisiana Kitchen Inc. is the franchisor and operator of «Popeyes» restaurants, the world’s second-largest Quick-Service Restaurant (QSR) chicken concept based on number of units. As of December 25, 2016, Popeyes had 2’688 operating restaurants in the United States, three territories, and 25 foreign countries. The Company’s primary objective is to deliver sales and profits by offering excellent investment opportunities in its Popeyes brand and providing exceptional franchisee support systems and services to its owners.

bakenet:eu